CONFIDENTIAL
Bill, so that if we accept the decision of the Treasury
Winister we thus would make the overseas suppliers face
an even worse situation at the time of the changeover
than they had expected.
This will obviously sharpen
their objections considerably.
4. The timing is especially difficult for our relations
As you know,
with two of the suppliers. The Indians are being most
گناه
difficult about giving us the necessary waiver of the
with them
Trade Agreement in order to introduce the textile
duties; and the negotiations with the Hong Yong Govern-
ment on the size of their defence contribution for the
next
5
years are both difficult and making little
progress.
In part, the lack of progrese can be laid
ver a period
to the resentment that has accumulated
of years regarding actions by HMG which the colony-
consider have disregarded Hong Yong's needs, rights and
vital interest.
5. It is certain that if we are unable to give temp-
at
orary relief from the new tariff, the Governor of
Hong Zong will find it even more difficult to secure
the agreement of the urofficial members of his
Legislative Council to the proposed contribution towards
the cost of keeping armed forces in the Colony.
6. I therefore home that it will be possible to
reconsider this question in the light of the factorse
I have set out above. I fully understand the problema
that a new clause would presert for "ony Barber but
these seem to me to be outweighed by the considerable
advantages we would obtain if temporary relief is in
fact given to the developing countries in the Commonwealth
freference Area.
7. I am sending a copy of this minute to Tony Barber
and Michael Noble.
CONFT E TIAL